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Supreme Court will hear NCAA dispute over compensation for student-athletes

The U.S. Court of Appeals for the 9th Circuit has said the NCAA’s rules were anticompetitive under the nation’s antitrust laws. (Jae C. Hong/AP)
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The Supreme Court on Wednesday announced it would get involved in the long-running dispute about how college athletes may be compensated.

The justices accepted a petition from the NCAA defending its restrictions on compensation for some college basketball and football players, which could have major implications for the way college sports is governed and the authority granted to the NCAA.

The NCAA, along with the major college sports conferences, asked the justices to review a decision by the U.S. Court of Appeals for the 9th Circuit, which said the rules were anticompetitive under the nation’s antitrust laws. The appeals court said the NCAA could not cap education-related compensation and benefits for college athletes in Division I football and basketball programs.

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“This is an issue that has been festering for a number of years now,” said Gabe Feldman, director of the Tulane Sports Law Program. “The Supreme Court has not ruled on amateurism and the application of antitrust law in relation to the NCAA in over 35 years. There has been a fair amount of confusion in the courts with litigants over the scope and deference the NCAA is entitled to over antitrust law.”

The Supreme Court hasn’t weighed in on antitrust matters involving college athletics since NCAA v. Board of Regents in 1984, a case that stripped the NCAA of its control over television rights. It will now hear this case at a time when the college sports landscape is rapidly shifting and the NCAA’s longtime amateurism model faces attacks on multiple fronts.

Congress is considering multiple bills that would grant college athletes the right to earn money off the use of their name, image and likeness, known as “NIL.” Five states already have passed legislation addressing athlete endorsements, and more than two dozen others are considering bills.

The NCAA has long-resisted any measures that would allow athletes to receive payment. But under growing pressure, its Division I Council, a group of conference officials, university administrators, athletes and other stakeholders who draft NCAA policy, is expected to vote on a measure next month that would allow athletes to earn NIL money starting in August 2021.

“The NCAA is basically juggling flaming knives right here,” Feldman said. “There’s lots of potential threats to their governance model and their ability to govern. Each one of the pieces of activity, whether at the state level, federal level or in the courts, represents a different type of threat to the NCAA.”

While the Supreme Court won’t necessarily be hearing NIL arguments, the antitrust case is a related issue that strikes directly at the NCAA’s power and authority, Feldman said, “and how much outside interference should be permitted.”

In March, a three-judge panel of the 9th Circuit upheld a ruling from U.S. District Judge Claudia Ann Wilken, saying the NCAA can’t place restrictions on the education-related benefits available to athletes playing in Division I Football Bowl Subdivision or Division I men’s or women’s basketball. Wilken issued an injunction that included a long list of potential perks that are barred by current NCAA guidelines, such as scholarships for graduate degrees and paid postgraduate internships, as well as computers, science equipment and musical instruments.

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As the NCAA considers how it can maintain its amateurism while also allowing athletes to pursue endorsement money, the organization said in its petition that the 9th Circuit ruling would insert courts too much into the process.

“The rule changes that the 9th Circuit’s decision requires, moreover, will fundamentally transform the century-old institution of NCAA sports, blurring the traditional line between college and professional athletes,” the organization said in its filing.

But lawyers representing players led by Shawne Alston, a former West Virginia football player, said that is hyperbole. The 9th Circuit’s instructions “apply only to NCAA restrictions on education-related benefits that schools may offer Division I basketball and FBS football players benefits such as computers, science equipment, musical instruments, postgraduate scholarships, tutoring, study abroad, academic awards, and internships,” the athletes told the court in their brief.

The ruling does not, however, authorize “so-called pay for play, which petitioners argue would be the end of ‘amateur’ sports,” the players’ lawyers wrote.

The cases are NCAA v. Alston and American Athletic Conference v. Alston. They will be heard at the court after the first of the year, with a decision expected by the close of the court’s term at the end of June.

“We are pleased the U.S. Supreme Court will review the NCAA’s right to provide student-athletes with the educational benefits they need to succeed in school and beyond,” Donald Remy, the NCAA’s chief legal officer, said in a statement. “The NCAA and its members continue to believe that college campuses should be able to improve the student-athlete experience without facing never-ending litigation regarding these changes.”

Even though the athletes had argued there was no reason for the court to review the appeals court decision, one of their lawyers expressed confidence in the outcome.

Jeffrey Kessler, a prominent sports labor lawyer and frequent NCAA opponent, said in an emailed statement: “We look forward to the Supreme Court reaffirming that the antitrust laws apply to the big business of Division I basketball and FBS football with full effect and that the era of athlete exploitation at our biggest colleges and universities must come to an end.”